Managers handed pounds 1bn future shock: Top executives are failing to control key projects, often with dire results, writes Roger Trapp

THE realisation that for most businesses the Nineties will be all about change and how to adapt to it and manage it - not once but continually - has produced a shift away from line management to project management.

The idea is that the challenges facing many companies are so momentous that they are beyond the scope of managers acting in accordance with their day-to-day tasks. Instead, they can only be tackled by special teams, drawn from a variety of disciplines.

The theory is that these teams can deal with such problems as the introduction of information technology, or a move to new premises, in a detached manner that is beyond conventional management.

There are signs, however, that this is little more than theory. The Association of Project Managers voiced its concern about the effectiveness of the approach some time ago. It urged greater recognition of the specialist nature of the project manager's work as one way of dealing with the problem.

Now the Management Consultancies Association - whose members (Britain's leading consulting firms) have been promoting the project management idea - has suggested that a good proportion of such projects in the UK fail, at an estimated cost of pounds 1bn a year.

In a report based on a survey of 200 senior executives in large public companies, state-owned enterprises, central and local government and the National Health Service, the MCA highlighted 'a surprising lack of awareness', among top executives, of the performance of big projects in their organisations; a large number of projects that are not achieving what was expected of them; and significant differences in reported success rates in the four sectors, with the service industries performing particularly badly and the Government doing better than average.

'Soft' projects, designed to deal with such subjects as reorganisation and the implementation of IT, were also shown to be less successful than 'hard' projects, including construction and maintenance. After all, the term project management originated in - and in many minds is confined to - the construction industry. So why are so many projects falling by the wayside?

The answers are simple and predictable, and managers involved in these sectors were in general agreement on the causes of failure when they met earlier this month to hear the results of the research.

Unclear or conflicting objectives, poor planning and foresight, a weak and / or unsupported leader and lack of top management backing were often cited. But more serious - and in these cost-conscious times, surprising - was inadequate monitoring. In more than a quarter of projects, the report said, senior managers failed to set up steering groups to monitor costs and progress, often being told of the state of projects only when there was a problem.

Moreover, 30 to 40 per cent of organisations did not carry out post-project reviews, denying themselves the chance to learn from past mistakes and previous successes.

To judge from the number of complaints at the presentation about senior managers' lack of knowledge and understanding of the concept, there is a need for training - both of those responsible for setting up the projects and of those charged with executing them.